A Comparison between American and Japanese Business Culture

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Because of the rise of Asian economies in the latter part of the 20th century, it is becoming increasingly important to understand how cultural mores of the countries in this region impact business practices. This report will evaluate Japanese business in contrast to American business culture. Through a case study, an analysis will be conducted to assess the considerations that an American must consider when conducting business in Japan.

Business Scenario

This case study will consider the scenario where an American is sent to train management and employees of a retail franchise that will be opening in Japan. The franchise is a sporting goods store that focuses on selling clothing and equipment for outdoor sports, such as skiing, golfing, and hiking. For the company, the opening of a store in Japan represents its first expansion to an overseas market. Over the next ten years, the firm plans to expand retail operations in critical markets in Japan. Because the retail chain relies on brand image as a component of its competitive advantage, it is essential that a manager from headquarters in the United States participate in the training process. The representative will have two months to train personnel for the opening of the first store. Among the areas of training covered will be company culture, company policies, and employee incentive structures. The primary goal is to ensure the successful opening of the new retail store while determining how the company’s culture, which is based on American cultural values, can be adapted to meet the cultural expectations of Japanese employees.

Cultural Differences

The primary cultural dimension that will impact the representative’s training program in Japan is individuality. In United States retail stores, competition is the foundation of the company culture and sets the foundation for company incentive structures. Because the company targets adventurous and competitive outdoor sports enthusiasts by offering performance equipment, the company seeks to foster an environment that encourages competition. However, this value will need to be modified to adapt to Japanese business culture.

While the United States promotes individualism as a foundation of its business culture, Japanese business culture is collectivist. According to scholarship on Japanese business culture, Japanese society is characterized by a vertical structure that places an emphasis on hierarchical relationships (Radnor, 2002, p. 46). Additionally, outward displays of politeness and deference to rank are expectations of those who conduct business in Japan (Radnor, 2002, p. 57). Further, the Japanese view on societal relationships informs its business culture. The Japanese possess the concept of Giri, which emphasizes social obligation to others in society (Radnor, 2002, p. 94). These cultural attributes differ from the United States' emphasis on individual attainment over organizational or hierarchical considerations in business.

The contrasting values between the United States and Japan will have implications for training management in Japan. First, the retail organization hosts weekly competitions between employees with prizes in order to foster a competitive store environment. While the company will still promote competitions in order to motivate employees and create a consistent culture in its Japanese stores, the trainer must consider Japanese culture when defining the scope of these competitions. First, while many competitions in the United States' stories are open to all employees, rather than simply being restricted to employees within certain functional divisions, the hierarchy must be acknowledged in the Japanese franchise. The trainer must only train managers in hosting competitions that are between front-line employees and employees within similar functional departments. For example, it would be inappropriate for a cashier to enter into a competition with a manager or the stock room clerk. Additionally, competitions should be modified so that employees in the Japanese franchise work together in teams to compete. This will enable the store to maintain a competitive environment while still maintaining a spirit of collectivism that is appropriate to Japanese business culture.

Additionally, the trainer must consider how the demand for decorum impacts daily business procedures. While the American franchise is informal in its approach to interacting with customers, Japanese employees are expected to display a greater degree of respect for consumers. For example, while store policy in the United States requires employees to make two attempts to encourage customers to purchase more expensive brands, employees in Japan must be subtle in their attempt to boost store sales. The trainer must work with employees to determine how employees can meet sales goals in a manner that is considerate of the culture in which they operate.

Discussion and Conclusion

This case study examines the challenges of introducing a business to a country where the business culture conflicts with the values of the host country. This can especially be a challenge when the brand of a company depends on its ability to promote a uniform culture, regardless of the restrictions placed by the countries in which it conducts business. In the case of the retail franchise in this scenario, the company culture of competition might interfere with the high degree of collectivism that distinguishes business culture in Japan. Though employees are encouraged to seek individual recognition through open competition against coworkers and managers, this activity must be curtailed to reflect the cultural values of Japanese employees. However, by modifying these activities to encourage team participation, the trainer can implement the same culture of competition that is present in American stores.


Radnor, R. A. (2002). Culture and contract: Cross-cultural conflict in United States-Japan business, the American perspective. ProQuest Dissertations and Theses, 839-839. Retrieved from http://search.proquest.com